Netskope Exceeds Q2 Revenue Targets with Strong ARR Growth
Netskope Inc. (NASDAQ:NTSK) reported second-quarter fiscal 2027 results that exceeded its revenue and operating-margin guidance, driven by strong demand for its cloud security platform and early traction in AI security offerings. The company achieved a year-over-year revenue increase of 29% to $220.5 million and annual recurring revenue (ARR) growth of 27% to $899 million. Adjusted operating margin improved significantly, reaching negative 9%, up from the previous year by 11 percentage points. Netskope raised its full-year revenue outlook to between $888 million–$892 million, reflecting approximately 26% growth and a projected positive free-cash-flow margin of about 2%. The company also announced a workforce reduction of roughly 5%, reallocating resources toward AI infrastructure development. CEO Sanjay Beri emphasized the growing demand for secure AI adoption in enterprises. The net retention rate reached 114%, with gross retention at an all-time high, and remaining performance obligations grew by 36% to $1.35 billion. Despite a free cash flow deficit of -$29.8 million, Netskope ended the quarter with $1.1 billion in cash equivalents.
Tickers: $NTSK
Topics: AI security cloud security revenue growth workforce reduction